Plenty of employees sign an arbitration agreement on day one without a second thought, often buried in a stack of onboarding paperwork. But that one form can quietly give up a major right: your day in court. We recently won an appeal that got one of these agreements thrown out, and it’s a good reminder of what they really mean.
What an arbitration agreement actually does. It’s a clause in which you agree that any dispute with your employer will be decided by a private arbitrator instead of a judge and jury. Employers often present it as routine, but it changes the entire playing field if something goes wrong later.
Why we generally caution employees about them. Arbitration tends to favor the employer. There’s usually no jury, the decision-maker is private, the proceedings are often confidential, the information you can gather can be more limited, and your right to appeal a bad result is extremely narrow. For an employee, that can be a tougher, quieter forum than open court.
The good news: they aren’t bulletproof. California courts can refuse to enforce an arbitration agreement when it’s unfair, for example when it’s forced on a take-it-or-leave-it basis and stacked with one-sided terms. That’s exactly the kind of challenge that can succeed. In a recent appeal, we persuaded a California appellate court that an arbitration agreement was unenforceable, keeping our client’s case where it belonged.
The takeaway. Read anything before you sign, and don’t assume a signature is the end of the story. Some agreements let you opt out within a short window, and an unfair one can sometimes be challenged even after you’ve signed.
At Grochow Law, we represent California employees, including fighting unfair arbitration agreements, and can help you understand your options.
